How Aldi and Lidl have become lifestyle brands as the big four race towards the discount space

[caption id="attachment_2322" align="aligncenter" width="275"] Aldi and Lidl now lifestyle brands for AB consumers[/caption]
Last week saw Aldi officially pass Waitrose as the sixth largest supermarket in the UK on total till receipts, according to Kantar Worldwide. This is not down to poor performance from Waitrose. It was the only supermarket to increase market share apart from Aldi and Lidl, during the same period.
It's due to the meteoric rise of the two continental challengers and supposed 'discounters'. Aldi, which also celebrated its 25th anniversary last week, has doubled its market share in only three years, attracting half a million new customers this year alone and now accounting for 5.4% of the market.
And this success is not purely based on the promise of low prices. Remarkably, recent research shows that ABs now account for 31% of shoppers at the discounters, the largest single demographic group and a huge increase on the 12% of ABs found in 2013.
So isn't it about time that we stopped calling what are clearly lifestyle brands 'discounters', especially when it's the main supermarkets leading the race to the bottom and slashing their costs?
A straw poll of friends, family and colleagues who use Aldi or Lidl returns phrases such as quality, fun, smart, unexpected and even green, and whilst they might not be able to agree on whether the meat or veg is best, they are rarely critical.
That's not something that can be said of the big four, who regularly generate a high degree of shopper cynicism. The slashing of prices in order to retain market share in the short term is also potentially damaging the supermarket brands, as consumers ask why they weren't charging those prices in the first place and who is getting the short straw to fund the cuts?
The young pretenders are successfully building their quality credentials alongside their brand personalities, with fun and irreverent marketing, PR and social media that is designed to appeal to savvy consumers who value quality, price and finding something a little different (both in terms of products and bargains), as they continue to seek growth.
The main supermarkets are undermining their brands by focusing solely on price as they seek to protect what they've got - something I advised against in a blog from January last year.
So who is behaving more like a discounter and who is behaving like a brand?
We're seeing a role reversal where the supermarkets, who used to be clever and adventurous in how they talked to their shoppers, from Asda Mums to Sainsbury's Jamie Oliver tie-in, are out-manoeuvred by competitors more in tune with UK consumers.